Blue Jeans Are Mounting a Comeback

(Bloomberg) -- From Ralph Lauren to Calvin Klein, America's biggest fashion labels are pinning their hopes on a blue jean revival. Across the industry, fashion brands are renewing their focus on denim, betting the wardrobe staple can be a major sales driver as jeans battle stretchy pants for supremacy from the waist down.

The jeanmaking industry has been just as distressed as the ripped denim of the same name. In recent years, jeans have struggled to beat back more comfortable styles such as leggings and yoga wear. Last year, imports of elastic knit pants surpassed those of jeans for the first time ever, according to the U.S. Census Bureau.

Making things worse, blue jean styles have been largely stagnant over the past decade, leaving shoppers little to get excited about. Sure, microtrends such as cropped flares and '80s throwbacks pop up here and there, but the skinny jean has remained the dominant style for more than a decade, with no real threat to its denim dominance.

Yet while Levi Strauss & Co. struggled for years to stave off pressure from stretchy pants, there are signs of a rebound. The jeans maker posted an 8 percent increase in revenue in 2017, thanks to a significant revamp of its women's jeans. That was its strongest annual growth since 2011.

Meanwhile, luxury labels are helping pull denim out of the doldrums. Downtown streetwear brand Off White's washed jeans drew lots of interest for reworked denim, as did the patchwork jean styles from Vetements that led the trendy label to collaborate with Levi's. Jeans makers have sought to develop increasingly “technical” denim to win over shoppers who demand more stretch and moisture-wicking, integrating fibers such as elastane and lyocell.

PVH Corp., which owns Tommy Hilfiger and Calvin Klein, has seen an “incredible improvement” in its jeans businesses worldwide, Chief Executive Officer Emanuel Chirico said on a conference call Thursday. He attributed the revival to the popularity of '90s style, and PVH is putting its marketing dollars behind it. This January, the company enlisted the bulk of the Kardashian clan—Kim, Khloe, Kourtney, Kendall, and Kylie—in a global ad campaign for Calvin Klein's jean and underwear lines.

“Clearly, the limited jeans product we have been focused on rolling out is paying huge dividends for us,” Chirico said of Calvin Klein's denim sales. “We're feeling really strongly about that business.”

Ralph Lauren Corp., in the midst of a bid to regain the brand's onetime cachet, singled out denim as a segment it will refocus on going forward after seeing an 8 percent spike year-to-date in its jean sales. Denim represents just 2 or 3 percent of the company's total revenue, and management said it should be much higher. “Based on recent consumer research, we believe that we have a clear basis to win in this category,” CEO Patrice Louvet said in February.

The mass-market labels are on board as well. American Eagle Outfitters Inc. set a record for volume last fall, luring teens into stores with tall walls of denim in hundreds of different silhouettes and washes, from ripped high-waisted “jeggings” to indigo mom jeans.

At J. Crew, denim led its sister brand Madewell to record sales both in stores and online last quarter, executives said. Even as J. Crew's flagship label struggles to get shoppers into its stores, Madewell continues to report double-digit increases in comparative store sales, thanks to jeans.

Gap Inc. CEO Art Peck said in March that he's seeing “very good performance” out of women's denim, too. Gap has even held internal “denim summits” to improve its jeans across all its brands.

To contact the author of this story: Kim Bhasin in New York at kbhasin4@bloomberg.net.

To contact the editor responsible for this story: David Rovella at drovella@bloomberg.net.

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